Repair, replace but don't infringe trade marks

Repair Directive

22 November 2023, the European Council adopted its position (or negotiating mandate) for the Directive on common rules on promoting the repair of goods (the Repair Directive).

The draft Repair Directive aims to create or at least support a circular economy by laying down rules to enhance and facilitate the repair of defective goods and keep them in use for as long as possible, rather than replacing and disposing of them prematurely. A new set of rights and tools will be available for consumers that encourage repair, including the following:

• the right for consumers to claim repair for products that are technically repairable under EU law (for example, televisions or mobile phones)
• an obligation for producers to inform consumers about the products that they are obliged to repair if possible
• a European repair information form that consumers may request from any repairer, to provide transparency to repair conditions and prices
• an online repair matchmaking platform to connect consumers with repairers in their area, and
• an extension of six months of the liability period in case of repair.

Read more on the proposal here.

Negotiating mandate

The negotiation mandate confirms the general objectives and most of the rules included in the Repair Directive, but also provides some clarifications and additions with regard to the right to repair, the European information form, and the online repair matchmaking platform.

The mandate notes manufacturers should carry out repairs within a reasonable timeframe, and, unless the service is free of charge, for a reasonable price, making sure consumers are not deterred from exercising their rights. 

Further, the Council proposes that only those companies that have the obligation to repair, are required to provide the European repair information form on request and free of charge. Other repairers may provide the form voluntarily, however if they do so, the conditions included in the form will be legally binding. It is also noted that the key information included in the form will be valid for 30 days, unless the consumer and repairer agree to extend this period.

In addition, the mandate provides for a single European online repair platform designed and operated on a European level, created to improve accessibility and facilitate cross-border services. Existing national online repair platforms may still be used and new ones created, as long as they meet the conditions and obligations set out in the Repair Directive.

Lastly, the Council states that consumers should keep the right to choose between repair and replacement for defective products within the seller's liability period. In case of repair, the seller’s liability period will be extended by six months starting from the moment the product is brought into conformity. This period may also be extended by Member States if desired. The seller is required to inform consumers about their right to replacement or repair, and about the additional liability period in case of repair.

Transposition and next steps

The negotiating mandate includes the formal position of the Council and provides the Council presidency with a mandate to negotiate with the European Parliament. The Repair Directive must now be adopted under the ordinary legislative procedure. The transposition period after adoption has been extended in this mandate by an additional six months (in addition to the originally proposed 24 months). It will therefore take some time before the rules come into force for consumers and producers.

Trade mark law and replacing parts: Audi AG v GQ (ECJ)

As noted, the Repair Directive delivers on the EU’s plan to create a circular economy that encourages the repair of defective goods, all part of the broader Green Deal strategy. Repairs often involve using replacement parts. From a trade mark law perspective, using non-authorised parts may lead to infringement claims as was seen in in an interesting dispute between Audi and GQ.

In this matter, Audi initiated proceedings against defendant GQ (a seller of replacement parts) at the district court in Warsaw, Poland on trade mark infringement grounds and requested an injunction to block GQ from offering allegedly infringing grilles (without the Audi mark), which closely resembled Audi’s original grille, including the cut-out for inserting and mounting Audi’s four-rings logo.

The regional Court of Warsaw referred several questions to the ECJ, including whether: (1) the marketing of car spare parts such as the radiator grilles in question constitutes, under EU law, ‘use in the course of trade’ liable to impair the functions of the Audi trademark; and (2) whether article 14(1)(c) EUTMR – which provides for referential trade mark use without prior authorisation of the trade mark owner – prevents Audi from prohibiting a third party from using a sign that is identical/confusingly similar to its trademark, i.e. spare car parts where that sign constitutes a mounting element for a car accessory.

The ECJ concludes that the sale of the carved-out grille: (1) does constitute use of the Audi mark which can be prohibited if the national courts determine the marks and goods/services are identical or similar and there is a likelihood of confusion and/or unfair advantage or detriment; and (2) the repair clause provided for in respect of designs in article 14(1)(c) EUTMR is not applicable. With regard to the last question, the ECJ further notes that, in the present case, the radiator grilles did not come from the proprietor of the Audi trade mark and were placed on the market without its consent. However, the element designed for the attachment of the Audi emblem is incorporated into them for the purposes of the marketing of the grilles by the third party. The fact that it is visible to the public wishing to purchase such a spare part, could constitute a material link between the spare part in question and the proprietor of the Audi trademark. Therefore this use is liable to infringe the functions of the trade mark, which consist in particular in guaranteeing the origin or quality of the goods.

What does this mean going forwards?

This interesting case highlights that repairing goods (replacing parts) may give rise to several legal questions and issues, including with regard to trade mark rights. The new EU Design Right Package also explicitly deals with this topic from a design right perspective by including a repair clause intended to liberalise the spare parts market. This means that repairs of component parts of complex products of the type specified in the legislation do not constitute design infringement. This applies to Community designs and national Member State designs. 

The Repair Directive (presuming inclusion of changes made in the negotiation mandate) can hopefully facilitate repairing goods and help prevent waste and unnecessary environmental impact.    

Should you need further information on the legal issues when repairing goods, whether from a trade mark law or other perspective, please contact a member of our international product liability and product safety team and the trade mark team for assistance.